AG Barr facing tough competition as sales slump

Bad weather dampened sales at Irn-Bru maker AG Barr in the first half of the year as it also faced tough competition in a market where prices are falling.

AG Barr's is faces tough competition. Picture: Contributed
AG Barr's is faces tough competition. Picture: Contributed

The Cumbernauld-based firm said sales for the six months to 25 July were expected to be 5 per cent lower than the prior year at £128 million. Stripping out the impact of losing the Orangina brand and Finlays water, it saw a decline of 3.5 per cent.

Barr said trading had “remained subdued as anticipated” though it hoped to regain momentum in the second half.

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The company, which also makes Tizer and Rubicon, said its performance compared to a period last year when it was buoyed by its sponsorship of the Commonwealth Games in Glasgow.

It said this “along with poor weather, particularly in the north of the UK”, had hit sales while a switch-over in IT systems had produced “short term customer service challenges which have also impacted our overall revenue performance”.

Barr added: “Market conditions have remained competitive with ongoing deflation across the soft drinks market and continued high levels of price promotion. Despite these challenges our margins remain in line with management expectations.”

Financial performance in the current year would be weighted towards the second half.